"I Love Greed"

Here is Walter Williams' January 5 article. The title of this post, "I Love Greed," is actually the title of Williams' article, so it's his, not mine. Whether he is being tongue-in-cheek about that or not, I'll let the reader decide. As usual with a Williams article, the economics here are brilliant and simply explained. I have some comments below the article.

"What human motivation gets the most wonderful things done? It’s really a silly question, because the answer is so simple. It turns out that it’s human greed that gets the most wonderful things done. When I say greed, I am not talking about fraud, theft, dishonesty, lobbying for special privileges from government or other forms of despicable behavior. I’m talking about people trying to get as much as they can for themselves. Let’s look at it.

This winter, Texas ranchers may have to fight the cold of night, perhaps blizzards, to run down, feed and care for stray cattle. They make the personal sacrifice of caring for their animals to ensure that New Yorkers can enjoy beef. Last summer, Idaho potato farmers toiled in blazing sun, in dust and dirt, and maybe being bitten by insects to ensure that New Yorkers had potatoes to go with their beef.

Here’s my question: Do you think that Texas ranchers and Idaho potato farmers make these personal sacrifices because they love or care about the well-being of New Yorkers? The fact is whether they like New Yorkers or not, they make sure that New Yorkers are supplied with beef and potatoes every day of the week. Why? It’s because ranchers and farmers want more for themselves. In a free market system, in order for one to get more for himself, he must serve his fellow man. This is precisely what Adam Smith, the father of economics, meant when he said in his classic “An Inquiry Into the Nature and Causes of the Wealth of Nations" (1776), “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest." By the way, how much beef and potatoes do you think New Yorkers would enjoy if it all depended upon the politically correct notions of human love and kindness? Personally, I’d grieve for New Yorkers. Some have suggested that instead of greed, I use “enlightened self-interest.” That’s OK, but I prefer greed.

Free market capitalism is relatively new in human history. Prior to the rise of capitalism, the way people amassed great wealth was by looting, plundering and enslaving their fellow man. Capitalism made it possible to become wealthy by serving one's fellow man. Capitalists seek to discover what people want and then produce it as efficiently as possible. Free market capitalism is ruthless in its profit and loss discipline. This explains much of the hostility toward free market capitalism; some of it is held by businessmen. Smith recognized this hostility when he said, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." He was hinting at government-backed crony capitalism, which has come to characterize much of today’s businesses.

Free market capitalism has other enemies -- mostly among the intellectual elite and political tyrants. These are people who believe that they have superior wisdom to the masses and that God has ordained them to forcibly impose that wisdom on the rest of us. Of course, they have what they consider to be good reasons for restricting liberty, but every tyrant who has ever lived has had what he considered good reason for restricting liberty. A tyrant’s agenda calls for the attenuation or the elimination of the market and what is implied by it -- voluntary exchange. Tyrants do not trust that people acting voluntarily will do what the tyrant thinks they should do. They want to replace the market with economic planning and regulation.

The Wall Street occupiers and their media and political allies are not against the principle of crony capitalism, bailouts and government special privileges and intervention. They share the same hostility to free market capitalism and peaceable voluntary exchange as tyrants. What they really want is congressional permission to share in the booty from looting their fellow man." (Walter Williams, "I Love Greed, Jan. 5, 2012).

I personally don't like the word "greed," because it has a negative, evil connotation, but there is no question that people operate from self-interest. Everybody--EVERBODY--including the welfare recipient who would rather live off the government than work, is actuated by what they believe to be their own self-interest. Not every action of every human is always motivated by self-interest; there is a such a thing as "philanthropy," and often times people will make sacrifices for others with no real self-interest involved. But the fact remains that people, most of the time, are going to do what they believe to be best for themselves. Jesus recognized this in His classic statement, "Love thy neighbor as thyself." Jesus never taught self-hatred, He simply wanted to mitigate the worst abuses of selfish behavior. "Christian self-interest" is better than "enlightened self-interest," and is better than "greed."

Williams' economics, of course, is spot on, and his simple way of explaining it must send shudders down the backs of his opponents. It is extremely important to note that much of what is called "free-market capitalism" today is nowhere near the free market or capitalism. I, along with Walter Williams and every other believer in free-market capitalism, deplore the "crony capitalism" that goes on in Washington. It's been going on for a long time. Even the "laissez-faire" late-19th century was hardly that. Most of the trans-continental railroads were built (wastefully and fraudently) with government money, and most of them eventually went bankrupt (the only one that didn't was James Hill's Great Northern, which he built with private money and no government loans). When the Obama administration hands out hundreds of millions of dollars to its favorites (e.g., Solyndra, et al), that is NOT capitalism. And, not surprisingly, many of those ventures eventually fail for the reasons that Williams points out--they aren't built upon the peacable, voluntary exchange of producuers and consumers but on tyranny and force. And you can't build a successful economy on those principles.

You see, not only is free market capitalism "rutheless in its profit and loss discipline," consumers are "ruthless", too. If businesses do not provide the goods and services that consumer want--consumer self-interest--those businesses will fail. And do you think consumers care if those businesses fail? Of course not. The very reason those businesses DO fail is because of consumers not buying their products; somebody else is doing a better job of meeting consumers' "self-interest". Such a business should succeed because it is giving people what they want at a price they want to pay. And their profits will tell just how successful they are at doing what consumers want them to do. And those CEOs who have the foresight and wisdom to help those companies make those profits--profits, remember, made because that company is providing consumers what they want--should be well-rewarded for it. What they get paid is none of my business, or your business, or the media's business, and it's certainly not Barack Obama's business.

But, the lines in this year's presidential debate are already being drawn. Since it's obvious now that Mitt Romney is going to be the Republican nominee, swords are being drawn against "venture capitalists." I don't know anything about Mitt Romney's former business enterprises, and I don't care enough, at the moment, to do any research about it. And I doubt those who are starting to scream loudly about him know anything, either. I do know I get sick of reading statements like "all businesses care about are profits." That reeks of reading somebody's heart and mind to me, and nobody has that ability. But worse than that, and what really aggravates me, it is a horrible, unjustified slight on millions and millions of hard-working, successful Americans, who have worked, saved, sweated, and sacrificed to build their own economic futures. And while there are always some who cheat, the vast, vast, vast majority of successful American businessmen have played by the rules and earned what they have by the sweat of their brows and by their own foresight, industry, frugality, and virtue. And to hear worthless, useless incompetents like Barack Obama and his Democratic Party buffoons villify them, and build a whole movement--"Occupy whatever"--on class warfare, is a disgraceful, despicable thing. I have nothing but contempt for those who want to punish success, to "legally" steal (through taxes) from those who have succeeded just to buy votes of the stupid masses and stay in power. But that is Barack Obama and the Democratic Party, and they are liable to be in power...until there isn't anything left to steal. Read: Europe.

I have absolutely no use for businesses who cozy up to government for protection against the ruthlessness of the free market; it's consumers who suffer when that happens. But that's just another reason why government needs to be seriously downsized and stay out of the business world. There is a place and time for government to step in and protect property--that means my property, too, and that means, at times, against abusive business. But keep that involvement as minimal as possible and never subsidize businesses that can't profit on their own. If people want solar energy or electric cars--and it's obvious they don't--they'll demand it and it will be provided for them, cheaply, efficiently, and resourcefully, by the free market. Barack Obama and his Marxist, secular intellectual tyrants, may think they know what it's my self-interest. But I beg to differ.

And even if I'm stupid and don't know any better, I still want the freedom to be stupid and to make my choices for myself. With my own money. Buying what I want to buy. When I want to buy it. From whom I want to buy it (thank you, Wal-Mart). Can somebody--anybody--explain to me why I should let those decisions be taken away from me and given to Barack Obama, a man who, the only thing he knows how to run is his mouth?

Free Online Books

The lady at the link above, "Free Online Books," was nice enough to put all my cowboy stories on her site, so I think it's only fair I put a link to her site as well. Check it out if you're looking for something to read.